Survey Says Apartments Offer Best Buying Opportunity

Jun 01, 2009

Investors currently view apartments as the most favorable commercial property type to buy, according to an April online survey of 467 investors conducted by NREI and Marcus & Millichap. More than one-third of respondents (38%) reported that now is the time to purchase apartments, followed by retail (24%), industrial (23%), office and mixed-use (tied at 21%), and hotels (18%). An even higher percentage of investors said that now is not the time to buy or sell commercial real estate. Between 45% and 49% of respondents indicated now is the time to hold each major property type.

The recession also is taking a toll on effective rents. Hotels, office and retail investors have taken the biggest hit on that front. Between 53% and 61% of investors in those three property types noted a drop in effective rents over the past 12 months.

Across the property sectors, at least half of investors reported a decrease in their property values over the past six months, and between 27% and 45% expect a further drop over the next six months. For more analysis, go to nreionline.com and click on Real Estate Investment Quarterly Report.